Entrenched premium leaves gold primed to climb despite surge in US bond yields

Gold has stayed resilient above $4,000 an ounce even as US Treasury yields surged to their highest since 2002, a sign that the post-2022 “demand premium” may be sticking around longer than some expected. Reuters reports that the relationship between bullion and real yields, which historically explained much of gold’s moves through interest rates and dollar changes, shifted after Western sanctions froze about half of Russia’s official reserves. Central banks, especially in emerging markets, have accelerated reserve diversification away from dollar assets, supporting gold despite higher yields. Strategist Nicky Shiels at MKS PAMP estimates the debasement and de-dollarisation premium rose from about $120 per ounce before 2022 to more than $1,000 on average since then, with roughly $840 currently.